Daily Compound Interest Formula

The daily compound interest formula calculates interest 365 times in a year. Hence the value of n is 365. According to the explanation, the daily compound interest formula is,

A = P (1 + r / n)^nt 

And 

Compound interest = A – P 

C.P = P (1 + r / n)^nt – P

Here,

P represents  the principal amount

r represents the rate of interest

t represents the time in years

n represents the number of times the amount is compounding. When calculate compounds interest on daily basis which means that the amount compounds 365 times in a year. i.e., n = 365.

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Daily Compound Interest Formula: Compound interest is interest earned on both the principal and interest over a specific time period. The interest that accumulates on a principal over time is equally accounted for as the principal. Furthermore, the following period’s interest calculation is based on the cumulative principal value.

Compound interest is the modern way of calculating interest that is utilized for all financial and economic transactions worldwide. Compound interest is computed on a regular interval, such as annually, semi-annually, quarterly, monthly, or daily. It’s as though reinvesting an investment’s interest income allows the money to grow quickly over time.